The Lankan crisis: Forex reserves rise for first time in five months

Sri Lanka’s foreign exchange pile rose for the first time in five months, likely due to deferment of payments to India under an Asian Clearing Union, even as the nation scrambles for credit lines to ease shortages.

The stockpile rose to $1.92 billion at the end of May, from $1.81 billion the previous month, according to data released by the central bank.

The figure includes a swap facility from the People’s Bank of China equivalent to about $1.5 billion, which remains largely unusable due to conditions.

The island nation had requested China to lift conditions on the swap but is yet to hear back on its request. President Gotabaya Rajapaksa, in a Bloomberg interview on Monday, said China seems to have shifted its strategic focus and didn’t seem interested in giving as much attention to crisis-ridden South Asian countries.

The country needs nearly $6 billion in the next six months to tackle shortages of essentials from food, fuel and medicines.

40-yr tax relief for Chinese-built port city

Crisis-hit Sri Lanka has decided to give special 40-year tax relief for Chinese-built Colombo Port city to attract potential investors as the island nation’s largest foreign direct investment failed to attract investments after the much-touted project opened for nearly one year.

Cabinet spokesperson Bandula Gunawardana during a weekly Cabinet briefing said that the Cabinet had decided to offer the concessions to draw more investments to the Port City, the Economy Next reported (PTI).

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